1006-00002 · Crestline Packaging Solutions LLC · Plan and Disclosure Statement

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UNITED STATES BANKRUPTCY COURT NORTHERN DISTRICT OF OHIO EASTERN DIVISION

DECLARATION OF PINNACLE CLAIMS ADMINISTRATION LLC CERTIFYING THE TABULATION OF VOTES ON THE PREPACKAGED PLAN OF REORGANIZATION OF CRESTLINE PACKAGING SOLUTIONS LLC AND CPS HOLDINGS INC.

Related to Dkt. 47 (Plan of Reorganization) and Dkt. 48 (Disclosure Statement)

I. INTRODUCTION AND DECLARANT IDENTIFICATION

1. I, Jennifer R. Lindquist, hereby declare as follows. I am a Senior Vice President and Director of Tabulation Services at Pinnacle Claims Administration LLC ("Pinnacle"), a limited liability company organized under the laws of the State of Minnesota, with its principal office located at 1010 Dale Street North, St. Paul, Minnesota 55117. I am over the age of eighteen (18), am competent to testify as to the matters set forth herein, and I make this declaration based upon my personal knowledge and upon information gathered in the course of my duties supervising the tabulation of votes in connection with the above-captioned Chapter 11 cases.

2. Pinnacle was retained as the claims and noticing agent in the Chapter 11 cases of Crestline Packaging Solutions LLC ("Crestline" or "CPS") and CPS Holdings Inc. ("CPS Holdings," and together with Crestline, the "Debtors") pursuant to an order of this Court entered on June 22, 2022. In connection with the solicitation of votes on the Prepackaged Plan of Reorganization of Crestline Packaging Solutions LLC and CPS Holdings Inc. (the "Plan," filed as Dkt. 47), Pinnacle was further designated as the official tabulation agent responsible for receiving, processing, and tabulating all ballots submitted by holders of claims in the impaired classes entitled to vote on the Plan.

3. This declaration is submitted pursuant to 28 U.S.C. § 1746 in lieu of verification by affidavit. The purpose of this declaration is to certify to the Court the results of the voting on the Plan by holders of claims in Classes 2, 3, and 4 — the three impaired classes of claims that were entitled to vote on the Plan. This declaration is submitted in support of the Debtors' motion for entry of an order confirming the Plan, which is scheduled to be heard by this Court on or after August 10, 2022. Unless otherwise defined herein, capitalized terms used in this declaration shall have the meanings ascribed to them in the Plan.

4. In my capacity as Senior Vice President and Director of Tabulation Services at Pinnacle, I supervised the ballot distribution, collection, review, and tabulation process for the Plan. I have personal knowledge of the procedures employed by Pinnacle in tabulating the votes, the methodology used to determine whether individual ballots should be counted or excluded, and the aggregate results of the voting for each class of claims entitled to vote. The statements set forth in this declaration are true and correct to the best of my knowledge, information, and belief.

II. BACKGROUND

A. The Chapter 11 Cases

5. On June 20, 2022 (the "Petition Date"), Crestline Packaging Solutions LLC, an Ohio limited liability company headquartered at 4710 Industrial Corridor Drive, Akron, Ohio 44308, and CPS Holdings Inc., a Delaware corporation and the direct parent and sole equity holder of Crestline, filed voluntary petitions for relief under Chapter 11 of Title 11 of the United States Code, 11 U.S.C. §§ 101–1532 (the "Bankruptcy Code"), in the United States Bankruptcy Court for the Northern District of Ohio, Eastern Division (the "Court"). The Chapter 11 cases are being jointly administered under Case No. 22-51247 pursuant to Rule 1015(b) of the Federal Rules of Bankruptcy Procedure (the "Bankruptcy Rules").

6. The Debtors continue to operate their businesses and manage their properties as debtors in possession pursuant to sections 1107(a) and 1108 of the Bankruptcy Code. No trustee, examiner, or statutory committee of unsecured creditors has been appointed in these cases.

B. Retention of Pinnacle as Claims and Noticing Agent / Tabulation Agent

7. By order dated June 22, 2022 [Dkt. 14], this Court approved the retention and appointment of Pinnacle as the claims and noticing agent for the Debtors pursuant to 28 U.S.C. § 156(c) and the applicable procedures governing claims and noticing agents in this District. In this capacity, Pinnacle has been responsible for, among other things, maintaining the official claims register, receiving and docketing proofs of claim, and serving notices and other documents required to be provided to creditors, equity holders, and parties in interest.

8. In connection with the solicitation of votes on the Plan, Pinnacle was further designated as the official tabulation agent responsible for (i) distributing ballot packages to holders of claims in the impaired classes entitled to vote on the Plan, (ii) receiving and processing completed ballots, (iii) determining the validity of each ballot received, and (iv) tabulating and certifying the results of the voting. The terms and conditions of Pinnacle's engagement as tabulation agent are set forth in the Tabulation Agent Agreement dated June 18, 2022, between Pinnacle and the Debtors, as approved by the Court.

C. The Prepackaged Plan and Disclosure Statement

9. The Debtors filed the Plan as Dkt. 47 and the accompanying Disclosure Statement Describing the Prepackaged Plan of Reorganization of Crestline Packaging Solutions LLC and CPS Holdings Inc. (the "Disclosure Statement") as Dkt. 48 on or about June 20, 2022, simultaneously with the commencement of these Chapter 11 cases.

10. The Plan is a prepackaged plan of reorganization within the meaning of sections 1125 and 1126 of the Bankruptcy Code. The solicitation of votes on the Plan was conducted prior to the Petition Date, in compliance with applicable non-bankruptcy law (including the Securities Act of 1933, as amended, and the Trust Indenture Act of 1939, as amended, to the extent applicable) and section 1126(b) of the Bankruptcy Code. Section 1126(b) provides that the holder of a claim or interest that has accepted or rejected a plan before the commencement of a case under the Bankruptcy Code is deemed to have accepted or rejected such plan if the solicitation of such acceptance or rejection was in compliance with any applicable non-bankruptcy law, rule, or regulation governing the adequacy of disclosure in connection with such solicitation, or if there is not any such law, rule, or regulation, the solicitation was conducted after disclosure to such holder of adequate information, as defined in section 1125(a) of the Bankruptcy Code.

11. The hearing to consider the adequacy of the Disclosure Statement pursuant to section 1125 of the Bankruptcy Code and the confirmation of the Plan pursuant to section 1129 of the Bankruptcy Code is scheduled for August 10, 2022 (the "Confirmation Hearing").

D. Solicitation Procedures

12. In connection with the filing of the Chapter 11 cases, the Debtors filed a motion seeking entry of an order (i) approving the solicitation procedures employed in connection with the prepetition solicitation of votes on the Plan (the "Solicitation Procedures"), (ii) confirming the adequacy of the prepetition solicitation conducted under section 1126(b) of the Bankruptcy Code, and (iii) establishing the Voting Deadline and certain related procedures (the "Solicitation Procedures Motion"). The Court entered an order granting the Solicitation Procedures Motion on June 24, 2022 [Dkt. 22] (the "Solicitation Procedures Order").

13. Pursuant to the Solicitation Procedures Order, the Voting Deadline was established as August 3, 2022 at 5:00 p.m. (Eastern Time). All ballots were required to be properly completed, executed, and received by Pinnacle on or before the Voting Deadline in order to be counted as valid votes on the Plan.

14. Ballot forms, in the forms approved by the Court as exhibits to the Solicitation Procedures Order, were distributed to holders of claims in Classes 2, 3, and 4 — the three impaired classes entitled to vote on the Plan. Each ballot form identified the class of the holder's claim, provided instructions for completing and returning the ballot, specified the Voting Deadline, and identified the addresses and electronic submission portals to which completed ballots were to be returned.

15. Under the Plan, Classes 1 and 5 are unimpaired or otherwise deemed to accept the Plan and were not entitled to vote. Specifically:

(a) Class 1 (Other Priority Claims) is unimpaired under the Plan. Holders of Class 1 claims are deemed to have accepted the Plan pursuant to section 1126(f) of the Bankruptcy Code and were not entitled to vote on the Plan.

(b) Class 5 (Intercompany Claims) consists of intercompany claims that will be reinstated or cancelled at the Debtors' discretion. Class 5 is not entitled to vote on the Plan.

16. Class 6 (Existing Equity Interests), consisting of the equity interests in CPS Holdings held by Thornfield Capital Partners LP ("Thornfield"), is deemed to have rejected the Plan pursuant to section 1126(g) of the Bankruptcy Code because holders of Class 6 interests will receive no distribution under the Plan and all existing equity interests will be cancelled on the Effective Date. Accordingly, Class 6 was not solicited and was not entitled to vote on the Plan.

III. CLASSIFICATION OF CLAIMS AND INTERESTS UNDER THE PLAN

17. The Plan classifies claims against and interests in the Debtors into six classes. The following is a summary of each class, its treatment under the Plan, estimated recovery, and voting status:

Class 1 — Other Priority Claims

18. Class 1 consists of all allowed priority claims against the Debtors other than administrative expense claims and priority tax claims (which are treated separately under the Plan). Under the Plan, holders of Class 1 claims shall be paid in full, in cash, on the later of (i) the Effective Date and (ii) the date on which such claim becomes an allowed claim, or as soon thereafter as is reasonably practicable. The estimated recovery for holders of Class 1 claims is 100%. Class 1 is unimpaired under the Plan, and holders of Class 1 claims are conclusively deemed to have accepted the Plan pursuant to section 1126(f) of the Bankruptcy Code. Class 1 was not entitled to vote on the Plan.

Class 2 — First Lien Secured Claims

19. Class 2 consists of all allowed claims arising under the First Lien Credit Agreement dated as of October 13, 2017 (as amended, restated, supplemented, or otherwise modified from time to time, the "First Lien Credit Agreement"), by and among Crestline Packaging Solutions LLC, as borrower, CPS Holdings Inc., as guarantor, the lenders party thereto from time to time, and Ridgeline National Bank, N.A. ("Ridgeline"), as administrative agent and collateral agent. The First Lien Secured Claims include (i) $158,700,000 in aggregate outstanding principal amount under the first lien term loan facility and (ii) $32,600,000 in aggregate drawn and outstanding principal amount under the first lien revolving credit facility, together totaling $191,300,000 in aggregate principal amount of First Lien Secured Claims, plus accrued and unpaid interest, fees, expenses, and other amounts due and owing thereunder.

20. Under the Plan, holders of Class 2 claims shall receive, in full and final satisfaction, settlement, release, and discharge of their First Lien Secured Claims: (i) their pro rata share of 92% of the newly issued equity interests in reorganized Crestline (the "Reorganized Equity"), subject to dilution by the Management Incentive Plan (as defined in the Plan); and (ii) their pro rata share of $12,500,000 in aggregate principal amount of new first lien take-back term loan debt (the "New First Lien Term Loan"), issued by reorganized Crestline on the terms and conditions set forth in the term sheet attached as Exhibit C to the Plan. Class 2 is impaired under the Plan and is entitled to vote.

Class 3 — Second Lien Secured Claims

21. Class 3 consists of all allowed claims arising under the 9.75% Senior Secured Second Lien Notes due 2024 (the "Second Lien Notes"), issued on October 13, 2017 pursuant to that certain Indenture dated as of October 13, 2017 (the "Second Lien Indenture"), by and between Crestline Packaging Solutions LLC, as issuer, CPS Holdings Inc., as guarantor, and Continental Fiduciary Trust Company ("Continental Fiduciary"), as indenture trustee and collateral agent. The Second Lien Notes bear interest at a rate of 9.75% per annum and are identified by CUSIP No. 22761TAA3. As of the Petition Date, the outstanding principal amount of the Second Lien Notes was $56,000,000, plus accrued and unpaid interest of approximately $3,900,000 (including default rate interest at an additional 2.00% per annum from April 22, 2022, the date of the first interest payment default), for a total amount of Class 3 claims of approximately $59,900,000.

22. Under the Plan, holders of Class 3 claims shall receive, in full and final satisfaction, settlement, release, and discharge of their Second Lien Secured Claims: (i) their pro rata share of 8% of the Reorganized Equity, subject to dilution by the Management Incentive Plan; and (ii) warrants entitling the holders thereof to purchase, in the aggregate, up to an additional 5% of the Reorganized Equity (on a fully diluted basis), subject to dilution by the Management Incentive Plan, at a strike price and on the terms and conditions set forth in the Warrant Agreement attached as Exhibit D to the Plan. Class 3 is impaired under the Plan and is entitled to vote.

Class 4 — General Unsecured Claims

23. Class 4 consists of all allowed general unsecured claims against the Debtors, including but not limited to trade claims, contract rejection damage claims, and other unsecured claims that are not otherwise classified under the Plan. The aggregate amount of Class 4 claims is estimated to be approximately $14,800,000.

24. Under the Plan, holders of Class 4 claims shall receive, in full and final satisfaction, settlement, release, and discharge of their general unsecured claims, their pro rata share of a $1,500,000 cash distribution pool (the "GUC Distribution Pool"), which shall be funded by reorganized Crestline on the Effective Date. Based on the estimated aggregate amount of Class 4 claims, the estimated recovery for holders of Class 4 claims is approximately 10.1 cents on the dollar, or approximately 10.1%. Class 4 is impaired under the Plan and is entitled to vote.

Class 5 — Intercompany Claims

25. Class 5 consists of all intercompany claims between and among the Debtors. Under the Plan, Class 5 claims shall be, at the Debtors' election, either reinstated or cancelled on the Effective Date. The treatment of Class 5 claims shall be determined by the Debtors in their sole discretion in consultation with the Requisite Consenting Creditors (as defined in the Restructuring Support Agreement). Class 5 is not entitled to vote on the Plan.

Class 6 — Existing Equity Interests

26. Class 6 consists of all existing equity interests in CPS Holdings Inc., which are held by Thornfield Capital Partners LP. Under the Plan, all Class 6 equity interests shall be cancelled on the Effective Date, and holders thereof shall receive no distribution under the Plan. Class 6 is deemed to have rejected the Plan pursuant to section 1126(g) of the Bankruptcy Code, and holders of Class 6 interests were not solicited and were not entitled to vote on the Plan.

IV. TABULATION PROCEDURES AND METHODOLOGY

A. Receipt and Processing of Ballots

27. In accordance with the Solicitation Procedures Order and the instructions set forth in the ballot forms, Pinnacle received ballots from holders of claims in Classes 2, 3, and 4 by the following methods: (i) first-class mail, postage prepaid, addressed to Pinnacle Claims Administration LLC, Ballot Processing Center, P.O. Box 5012, St. Paul, Minnesota 55101; (ii) overnight courier or hand delivery to Pinnacle Claims Administration LLC, Attn: Crestline Packaging Ballot Tabulation, 1010 Dale Street North, Suite 200, St. Paul, Minnesota 55117; and (iii) electronic submission through Pinnacle's secure online balloting portal at https://cases.pinnacleadmin.com/crestline (the "Balloting Portal"). Ballots submitted via facsimile or electronic mail (other than through the Balloting Portal) were not accepted.

28. All ballots were required to be properly completed, executed, and actually received by Pinnacle on or before the Voting Deadline of August 3, 2022 at 5:00 p.m. (Eastern Time). Ballots received after the Voting Deadline were not counted, regardless of when they were mailed or transmitted.

29. Upon receipt, each ballot was logged and reviewed by Pinnacle personnel for the following:

(a) Timely receipt. Whether the ballot was received by Pinnacle on or before the Voting Deadline.

(b) Proper completion and execution. Whether the ballot was properly completed, including the identification of the voting party, the claim amount, and a clear indication of whether the holder accepted or rejected the Plan, and whether the ballot was duly executed by the holder or an authorized representative thereof.

(c) Identification of the claimant and claim amount. Whether the ballot identified the holder's name and the amount of the claim with sufficient specificity to enable Pinnacle to verify the holder's entitlement to vote and the claim amount for tabulation purposes.

(d) Clear indication of vote. Whether the ballot contained a clear and unambiguous indication of the holder's vote to accept or reject the Plan. Ballots that indicated both acceptance and rejection, or that failed to indicate either acceptance or rejection, were deemed defective.

(e) Absence of conditions or qualifications. Whether the ballot was free of any conditions, qualifications, or modifications to the holder's vote. Ballots containing any conditions, qualifications, or modifications were not counted, as provided in the Solicitation Procedures Order.

B. Ballot Counting Rules

30. Votes were tabulated in accordance with section 1126(c) of the Bankruptcy Code, which provides that a class of claims has accepted a plan if such plan has been accepted by creditors, other than any entity designated under section 1126(e), that hold at least two-thirds in amount and more than one-half in number of the allowed claims of such class held by creditors that have accepted or rejected such plan. Only ballots that were properly completed, executed, and timely received were included in the tabulation.

31. The following additional rules were applied in the tabulation process, consistent with the Solicitation Procedures Order:

(a) Duplicative ballots. In instances where a holder submitted more than one ballot with respect to the same claim, only the latest-dated valid ballot was counted for purposes of the tabulation. If two or more ballots for the same claim bore the same date, Pinnacle attempted to contact the holder to determine the holder's intent. If the holder's intent could not be ascertained, the latest-received ballot was counted.

(b) Defective ballots. Ballots that were unsigned, illegible, received after the Voting Deadline, or that contained conditions, qualifications, or modifications on the vote were deemed defective and were not counted in the tabulation. Pinnacle used reasonable efforts to contact holders who submitted defective ballots to provide them an opportunity to cure any defects prior to the Voting Deadline; however, Pinnacle was under no obligation to seek the cure of any defective ballot.

(c) Ballots subject to pending claim objections. Ballots cast by holders whose claims were the subject of pending objections were provisionally counted for tabulation purposes, subject to further order of the Court. To the extent that the resolution of any such objection would alter the voting results for any class, the Debtors reserve the right to bring such matter to the attention of the Court at or prior to the Confirmation Hearing.

(d) Beneficial holders of Second Lien Notes. With respect to Class 3 (Second Lien Secured Claims), beneficial holders of the Second Lien Notes were required to submit their ballots through the nominee or broker through which they held such notes, or to otherwise provide evidence of their beneficial ownership. Master ballots were submitted by the nominees on behalf of beneficial holders, and the votes reflected on such master ballots were tabulated in accordance with the instructions contained therein.

C. Temporary Allowance of Claims for Voting Purposes

32. For purposes of voting on the Plan, claims were temporarily allowed at the amounts reflected on the Debtors' schedules of assets and liabilities (the "Schedules"), as may be amended, or as set forth in timely filed proofs of claim, unless (i) the claim was the subject of a pending objection, in which case the claim was temporarily allowed in the amount, if any, set forth in the applicable ballot (subject to Court resolution), or (ii) the Court had entered an order establishing a different allowed amount for voting purposes. To the extent that any claim was scheduled as disputed, contingent, or unliquidated, such claim was temporarily allowed for voting purposes at the lesser of (a) the amount asserted in the proof of claim, if any, and (b) $1.00, unless otherwise ordered by the Court.

V. VOTING RESULTS — CERTIFICATION

A. Statutory Threshold

33. Under section 1126(c) of the Bankruptcy Code, a class of claims has accepted a plan of reorganization if the plan has been accepted by creditors that hold at least two-thirds in amount (i.e., 66.67% or more) and more than one-half in number (i.e., more than 50.00%) of the allowed claims of such class held by creditors, other than any entity designated under section 1126(e), that have accepted or rejected such plan. The tabulation results set forth below are presented in accordance with these statutory requirements.

B. Class 2 — First Lien Secured Claims

34. The following table summarizes the voting results for Class 2 (First Lien Secured Claims):

35. The aggregate principal amount of First Lien Secured Claims is $191,300,000. Of the 24 holders of Class 2 claims that returned valid, timely ballots, 21 holders, holding claims in the aggregate amount of $181,161,100, voted to accept the Plan, and 3 holders, holding claims in the aggregate amount of $10,138,900, voted to reject the Plan.

36. Accordingly, the Plan was accepted by holders representing 94.7% of the aggregate amount of Class 2 claims that voted, which exceeds the two-thirds (66.67%) threshold required under section 1126(c) of the Bankruptcy Code. The Plan was further accepted by 87.5% of the number of Class 2 claimants that voted, which exceeds the one-half (50.00%) threshold required under section 1126(c) of the Bankruptcy Code.

37. Conclusion: Class 2 (First Lien Secured Claims) has ACCEPTED the Plan.

C. Class 3 — Second Lien Secured Claims

38. The following table summarizes the voting results for Class 3 (Second Lien Secured Claims):

39. The aggregate amount of Second Lien Secured Claims is approximately $59,900,000, consisting of $56,000,000 in outstanding principal amount of the Second Lien Notes (CUSIP No. 22761TAA3) plus approximately $3,900,000 in accrued and unpaid interest (including default rate interest at an additional 2.00% per annum from April 22, 2022). Of the 14 holders (or nominees submitting master ballots on behalf of beneficial holders) of Class 3 claims that returned valid, timely ballots, 11 holders, holding claims in the aggregate amount of $53,430,800, voted to accept the Plan, and 3 holders, holding claims in the aggregate amount of $6,469,200, voted to reject the Plan.

40. Accordingly, the Plan was accepted by holders representing 89.2% of the aggregate amount of Class 3 claims that voted, which exceeds the two-thirds (66.67%) threshold required under section 1126(c) of the Bankruptcy Code. The Plan was further accepted by 78.6% of the number of Class 3 claimants that voted, which exceeds the one-half (50.00%) threshold required under section 1126(c) of the Bankruptcy Code.

41. Conclusion: Class 3 (Second Lien Secured Claims) has ACCEPTED the Plan.

D. Class 4 — General Unsecured Claims

42. The following table summarizes the voting results for Class 4 (General Unsecured Claims):

43. The aggregate estimated amount of General Unsecured Claims is approximately $14,800,000. Of the 38 holders of Class 4 claims that returned valid, timely ballots, 26 holders, holding claims in the aggregate amount of $11,292,400, voted to accept the Plan, and 12 holders, holding claims in the aggregate amount of $3,507,600, voted to reject the Plan.

44. Accordingly, the Plan was accepted by holders representing 76.3% of the aggregate amount of Class 4 claims that voted, which exceeds the two-thirds (66.67%) threshold required under section 1126(c) of the Bankruptcy Code. The Plan was further accepted by 68.4% of the number of Class 4 claimants that voted, which exceeds the one-half (50.00%) threshold required under section 1126(c) of the Bankruptcy Code.

45. Conclusion: Class 4 (General Unsecured Claims) has ACCEPTED the Plan.

VI. CONSOLIDATED SUMMARY OF VOTING RESULTS

46. The following table presents a consolidated summary of the voting results for all impaired classes entitled to vote on the Plan:

47. As reflected in the table above, each of the three impaired classes entitled to vote on the Plan — Class 2 (First Lien Secured Claims), Class 3 (Second Lien Secured Claims), and Class 4 (General Unsecured Claims) — has accepted the Plan by the requisite statutory majorities under section 1126(c) of the Bankruptcy Code. Specifically, in each such class, the Plan was accepted by creditors holding at least two-thirds in amount and more than one-half in number of the allowed claims of such class that voted to accept or reject the Plan.

48. In addition, as set forth in Section III above, Class 1 (Other Priority Claims) is unimpaired and deemed to accept the Plan under section 1126(f) of the Bankruptcy Code. Class 6 (Existing Equity Interests) is deemed to reject the Plan under section 1126(g) of the Bankruptcy Code. Class 5 (Intercompany Claims) was not entitled to vote on the Plan. Accordingly, all classes of claims entitled to vote have accepted the Plan.

VII. IRREGULARITIES AND DEFECTIVE BALLOTS

49. In the course of the ballot tabulation process, Pinnacle identified the following irregularities with respect to certain ballots received:

(a) Late Ballots. Pinnacle received a total of four (4) ballots after the Voting Deadline of August 3, 2022 at 5:00 p.m. (Eastern Time). These late ballots consisted of one (1) ballot in Class 2, zero (0) ballots in Class 3, and three (3) ballots in Class 4. In accordance with the Solicitation Procedures Order, these late ballots were not counted in the tabulation of votes. The late ballots are identified on Exhibit D hereto.

(b) Defective Ballots. Pinnacle received a total of two (2) ballots that were deemed defective and were not counted. One (1) ballot in Class 3 was unsigned and was not cured despite Pinnacle's reasonable efforts to contact the holder prior to the Voting Deadline. One (1) ballot in Class 4 contained conditional language purporting to condition the holder's vote on the resolution of a pending contract dispute and was therefore excluded as a conditional ballot. These defective ballots are identified on Exhibit D hereto.

(c) Duplicate Ballots. Pinnacle received a total of three (3) duplicate ballots — two (2) in Class 2 and one (1) in Class 4. In each instance, the later-dated ballot was counted and the earlier-dated ballot was excluded, in accordance with the ballot counting rules set forth in the Solicitation Procedures Order and described in Section IV.B above.

(d) Motions to Designate. As of the date of this declaration, no party in interest has filed a motion to designate (i.e., disqualify) any vote under section 1126(e) of the Bankruptcy Code. Accordingly, no votes have been designated or excluded under section 1126(e).

50. Pinnacle confirms that none of the irregularities described above, individually or in the aggregate, would alter the outcome of the voting in any class. Even if all late and defective ballots were counted (in either direction), the Plan would still satisfy the acceptance thresholds of section 1126(c) in each impaired class.

VIII. EXHIBITS

51. Attached hereto as exhibits and incorporated herein by reference are the following detailed tabulation reports and schedules:

Exhibit A — Detailed Tabulation Report for Class 2 (First Lien Secured Claims). Exhibit A sets forth an itemized list of each ballot received by Pinnacle from holders of Class 2 claims, identifying (i) the claimant or holder name, (ii) the claim amount, (iii) the vote cast (accept or reject), and (iv) whether the ballot was counted or excluded (and if excluded, the reason for exclusion). Exhibit A contains 24 counted ballots and 3 excluded ballots (consisting of 1 late ballot and 2 duplicate ballots).

Exhibit B — Detailed Tabulation Report for Class 3 (Second Lien Secured Claims). Exhibit B sets forth an itemized list of each ballot (including master ballots submitted by nominees on behalf of beneficial holders) received by Pinnacle from holders of Class 3 claims, in the same format as Exhibit A. Exhibit B contains 14 counted ballots and 1 excluded ballot (consisting of 1 defective/unsigned ballot).

Exhibit C — Detailed Tabulation Report for Class 4 (General Unsecured Claims). Exhibit C sets forth an itemized list of each ballot received by Pinnacle from holders of Class 4 claims, in the same format as Exhibit A. Exhibit C contains 38 counted ballots and 5 excluded ballots (consisting of 3 late ballots, 1 conditional ballot, and 1 duplicate ballot).

Exhibit D — Schedule of Defective or Late Ballots. Exhibit D sets forth a consolidated listing of all ballots that were not counted in the tabulation, including (i) the name of the submitting party, (ii) the class of the claim, (iii) the claim amount, (iv) the date and time of receipt (if applicable), and (v) the reason for exclusion.

52. The information contained in Exhibits A through D was compiled from Pinnacle's records and represents a complete and accurate accounting of all ballots received by Pinnacle in connection with the solicitation of votes on the Plan.

IX. CONCLUSION AND CERTIFICATION

53. Based on the foregoing, Pinnacle Claims Administration LLC hereby certifies, under penalty of perjury pursuant to 28 U.S.C. § 1746, as follows:

(a) The tabulation of votes described in this declaration was conducted in accordance with the Solicitation Procedures approved by the Court pursuant to the Solicitation Procedures Order [Dkt. 22] and the applicable provisions of the Bankruptcy Code, including sections 1125, 1126(b), and 1126(c) thereof.

(b) All ballots received by Pinnacle on or before the Voting Deadline of August 3, 2022 at 5:00 p.m. (Eastern Time) were properly processed and tabulated in accordance with the procedures and rules described herein and in the Solicitation Procedures Order.

(c) Each of the three impaired classes of claims entitled to vote on the Plan has accepted the Prepackaged Plan of Reorganization by the requisite statutory majorities under section 1126(c) of the Bankruptcy Code, specifically:

(i) Class 2 (First Lien Secured Claims) accepted the Plan by 94.7% in amount and 87.5% in number of voting claimants;

(ii) Class 3 (Second Lien Secured Claims) accepted the Plan by 89.2% in amount and 78.6% in number of voting claimants; and

(iii) Class 4 (General Unsecured Claims) accepted the Plan by 76.3% in amount and 68.4% in number of voting claimants.

In each case, the acceptance exceeds the statutory thresholds of at least two-thirds in amount and more than one-half in number of claims voting as required by section 1126(c) of the Bankruptcy Code.

(d) This declaration and the certifications contained herein are true and correct to the best of the declarant's knowledge, information, and belief, formed after reasonable inquiry.

54. Pinnacle respectfully submits this declaration in support of the Debtors' request for confirmation of the Plan and stands ready to provide any additional information or testimony that the Court may require in connection with the Confirmation Hearing.

X. SIGNATURE BLOCK AND ATTESTATION

I declare under penalty of perjury under the laws of the United States of America that the foregoing is true and correct.

Executed on August 5, 2022, at St. Paul, Minnesota.

PINNACLE CLAIMS ADMINISTRATION LLC

By: ________

Name: Jennifer R. Lindquist

Title: Senior Vice President and Director of Tabulation Services

Address: 1010 Dale Street North

St. Paul, Minnesota 55117

Date: August 5, 2022

CERTIFICATE OF SERVICE: I hereby certify that on August 5, 2022, a true and correct copy of the foregoing Declaration of Pinnacle Claims Administration LLC Certifying the Tabulation of Votes on the Prepackaged Plan of Reorganization of Crestline Packaging Solutions LLC and CPS Holdings Inc., together with Exhibits A through D attached thereto, was served upon all parties entitled to notice by filing with the Court's electronic case filing system (CM/ECF), which will send notification of electronic filing to all registered participants, and by first-class mail, postage prepaid, upon those parties not registered for electronic notice, in accordance with Bankruptcy Rules 2002 and 9036 and the applicable local rules of this Court.

________________________________________

Jennifer R. Lindquist Senior Vice President and Director of Tabulation Services Pinnacle Claims Administration LLC

In re:	Chapter 11
CRESTLINE PACKAGING SOLUTIONS LLC and CPS HOLDINGS INC.,	Case No. 22-51247
Debtors.	(Jointly Administered)
Metric	Accepting	Rejecting	Total Voting	Percentage Accepting
Amount ($)	$181,161,100	$10,138,900	$191,300,000	94.7%
Number of Claims	21	3	24	87.5%
Metric	Accepting	Rejecting	Total Voting	Percentage Accepting
Amount ($)	$53,430,800	$6,469,200	$59,900,000	89.2%
Number of Claims	11	3	14	78.6%
Metric	Accepting	Rejecting	Total Voting	Percentage Accepting
Amount ($)	$11,292,400	$3,507,600	$14,800,000	76.3%
Number of Claims	26	12	38	68.4%
Class	Description	Accepting (Amount)	Threshold (Amount)	Accepting (Number)	Threshold (Number)	Plan Accepted?
2	First Lien Secured Claims	94.7%	≥ 66.67%	87.5%	> 50.00%	Yes
3	Second Lien Secured Claims	89.2%	≥ 66.67%	78.6%	> 50.00%	Yes
4	General Unsecured Claims	76.3%	≥ 66.67%	68.4%	> 50.00%	Yes

UNITED STATES BANKRUPTCY COURT NORTHERN DISTRICT OF OHIO EASTERN DIVISION
DECLARATION OF PINNACLE CLAIMS ADMINISTRATION LLC CERTIFYING THE TABULATION OF VOTES ON THE PREPACKAGED PLAN OF REORGANIZATION OF CRESTLINE PACKAGING SOLUTIONS LLC AND CPS HOLDINGS INC.
Related to Dkt. 47 (Plan of Reorganization) and Dkt. 48 (Disclosure Statement)
I. INTRODUCTION AND DECLARANT IDENTIFICATION
1.  I, Jennifer R. Lindquist, hereby declare as follows. I am a Senior Vice President and Director of Tabulation Services at Pinnacle Claims Administration LLC ("Pinnacle"), a limited liability company organized under the laws of the State of Minnesota, with its principal office located at 1010 Dale Street North, St. Paul, Minnesota 55117. I am over the age of eighteen (18), am competent to testify as to the matters set forth herein, and I make this declaration based upon my personal knowledge and upon information gathered in the course of my duties supervising the tabulation of votes in connection with the above-captioned Chapter 11 cases.
2.  Pinnacle was retained as the claims and noticing agent in the Chapter 11 cases of Crestline Packaging Solutions LLC ("Crestline" or "CPS") and CPS Holdings Inc. ("CPS Holdings," and together with Crestline, the "Debtors") pursuant to an order of this Court entered on June 22, 2022. In connection with the solicitation of votes on the Prepackaged Plan of Reorganization of Crestline Packaging Solutions LLC and CPS Holdings Inc. (the "Plan," filed as Dkt. 47), Pinnacle was further designated as the official tabulation agent responsible for receiving, processing, and tabulating all ballots submitted by holders of claims in the impaired classes entitled to vote on the Plan.
3.  This declaration is submitted pursuant to 28 U.S.C. § 1746 in lieu of verification by affidavit. The purpose of this declaration is to certify to the Court the results of the voting on the Plan by holders of claims in Classes 2, 3, and 4 — the three impaired classes of claims that were entitled to vote on the Plan. This declaration is submitted in support of the Debtors' motion for entry of an order confirming the Plan, which is scheduled to be heard by this Court on or after August 10, 2022. Unless otherwise defined herein, capitalized terms used in this declaration shall have the meanings ascribed to them in the Plan.
4.  In my capacity as Senior Vice President and Director of Tabulation Services at Pinnacle, I supervised the ballot distribution, collection, review, and tabulation process for the Plan. I have personal knowledge of the procedures employed by Pinnacle in tabulating the votes, the methodology used to determine whether individual ballots should be counted or excluded, and the aggregate results of the voting for each class of claims entitled to vote. The statements set forth in this declaration are true and correct to the best of my knowledge, information, and belief.
II. BACKGROUND
A. The Chapter 11 Cases
5.  On June 20, 2022 (the "Petition Date"), Crestline Packaging Solutions LLC, an Ohio limited liability company headquartered at 4710 Industrial Corridor Drive, Akron, Ohio 44308, and CPS Holdings Inc., a Delaware corporation and the direct parent and sole equity holder of Crestline, filed voluntary petitions for relief under Chapter 11 of Title 11 of the United States Code, 11 U.S.C. §§ 101–1532 (the "Bankruptcy Code"), in the United States Bankruptcy Court for the Northern District of Ohio, Eastern Division (the "Court"). The Chapter 11 cases are being jointly administered under Case No. 22-51247 pursuant to Rule 1015(b) of the Federal Rules of Bankruptcy Procedure (the "Bankruptcy Rules").
6.  The Debtors continue to operate their businesses and manage their properties as debtors in possession pursuant to sections 1107(a) and 1108 of the Bankruptcy Code. No trustee, examiner, or statutory committee of unsecured creditors has been appointed in these cases.
B. Retention of Pinnacle as Claims and Noticing Agent / Tabulation Agent
7.  By order dated June 22, 2022 [Dkt. 14], this Court approved the retention and appointment of Pinnacle as the claims and noticing agent for the Debtors pursuant to 28 U.S.C. § 156(c) and the applicable procedures governing claims and noticing agents in this District. In this capacity, Pinnacle has been responsible for, among other things, maintaining the official claims register, receiving and docketing proofs of claim, and serving notices and other documents required to be provided to creditors, equity holders, and parties in interest.
8.  In connection with the solicitation of votes on the Plan, Pinnacle was further designated as the official tabulation agent responsible for (i) distributing ballot packages to holders of claims in the impaired classes entitled to vote on the Plan, (ii) receiving and processing completed ballots, (iii) determining the validity of each ballot received, and (iv) tabulating and certifying the results of the voting. The terms and conditions of Pinnacle's engagement as tabulation agent are set forth in the Tabulation Agent Agreement dated June 18, 2022, between Pinnacle and the Debtors, as approved by the Court.
C. The Prepackaged Plan and Disclosure Statement
9.  The Debtors filed the Plan as Dkt. 47 and the accompanying Disclosure Statement Describing the Prepackaged Plan of Reorganization of Crestline Packaging Solutions LLC and CPS Holdings Inc. (the "Disclosure Statement") as Dkt. 48 on or about June 20, 2022, simultaneously with the commencement of these Chapter 11 cases.
10.  The Plan is a prepackaged plan of reorganization within the meaning of sections 1125 and 1126 of the Bankruptcy Code. The solicitation of votes on the Plan was conducted prior to the Petition Date, in compliance with applicable non-bankruptcy law (including the Securities Act of 1933, as amended, and the Trust Indenture Act of 1939, as amended, to the extent applicable) and section 1126(b) of the Bankruptcy Code. Section 1126(b) provides that the holder of a claim or interest that has accepted or rejected a plan before the commencement of a case under the Bankruptcy Code is deemed to have accepted or rejected such plan if the solicitation of such acceptance or rejection was in compliance with any applicable non-bankruptcy law, rule, or regulation governing the adequacy of disclosure in connection with such solicitation, or if there is not any such law, rule, or regulation, the solicitation was conducted after disclosure to such holder of adequate information, as defined in section 1125(a) of the Bankruptcy Code.
11.  The hearing to consider the adequacy of the Disclosure Statement pursuant to section 1125 of the Bankruptcy Code and the confirmation of the Plan pursuant to section 1129 of the Bankruptcy Code is scheduled for August 10, 2022 (the "Confirmation Hearing").
D. Solicitation Procedures
12.  In connection with the filing of the Chapter 11 cases, the Debtors filed a motion seeking entry of an order (i) approving the solicitation procedures employed in connection with the prepetition solicitation of votes on the Plan (the "Solicitation Procedures"), (ii) confirming the adequacy of the prepetition solicitation conducted under section 1126(b) of the Bankruptcy Code, and (iii) establishing the Voting Deadline and certain related procedures (the "Solicitation Procedures Motion"). The Court entered an order granting the Solicitation Procedures Motion on June 24, 2022 [Dkt. 22] (the "Solicitation Procedures Order").
13.  Pursuant to the Solicitation Procedures Order, the Voting Deadline was established as August 3, 2022 at 5:00 p.m. (Eastern Time). All ballots were required to be properly completed, executed, and received by Pinnacle on or before the Voting Deadline in order to be counted as valid votes on the Plan.
14.  Ballot forms, in the forms approved by the Court as exhibits to the Solicitation Procedures Order, were distributed to holders of claims in Classes 2, 3, and 4 — the three impaired classes entitled to vote on the Plan. Each ballot form identified the class of the holder's claim, provided instructions for completing and returning the ballot, specified the Voting Deadline, and identified the addresses and electronic submission portals to which completed ballots were to be returned.
15.  Under the Plan, Classes 1 and 5 are unimpaired or otherwise deemed to accept the Plan and were not entitled to vote. Specifically:
(a) Class 1 (Other Priority Claims) is unimpaired under the Plan. Holders of Class 1 claims are deemed to have accepted the Plan pursuant to section 1126(f) of the Bankruptcy Code and were not entitled to vote on the Plan.
(b) Class 5 (Intercompany Claims) consists of intercompany claims that will be reinstated or cancelled at the Debtors' discretion. Class 5 is not entitled to vote on the Plan.
16.  Class 6 (Existing Equity Interests), consisting of the equity interests in CPS Holdings held by Thornfield Capital Partners LP ("Thornfield"), is deemed to have rejected the Plan pursuant to section 1126(g) of the Bankruptcy Code because holders of Class 6 interests will receive no distribution under the Plan and all existing equity interests will be cancelled on the Effective Date. Accordingly, Class 6 was not solicited and was not entitled to vote on the Plan.
III. CLASSIFICATION OF CLAIMS AND INTERESTS UNDER THE PLAN
17.  The Plan classifies claims against and interests in the Debtors into six classes. The following is a summary of each class, its treatment under the Plan, estimated recovery, and voting status:
Class 1 — Other Priority Claims
18.  Class 1 consists of all allowed priority claims against the Debtors other than administrative expense claims and priority tax claims (which are treated separately under the Plan). Under the Plan, holders of Class 1 claims shall be paid in full, in cash, on the later of (i) the Effective Date and (ii) the date on which such claim becomes an allowed claim, or as soon thereafter as is reasonably practicable. The estimated recovery for holders of Class 1 claims is 100%. Class 1 is unimpaired under the Plan, and holders of Class 1 claims are conclusively deemed to have accepted the Plan pursuant to section 1126(f) of the Bankruptcy Code. Class 1 was not entitled to vote on the Plan.
Class 2 — First Lien Secured Claims
19.  Class 2 consists of all allowed claims arising under the First Lien Credit Agreement dated as of October 13, 2017 (as amended, restated, supplemented, or otherwise modified from time to time, the "First Lien Credit Agreement"), by and among Crestline Packaging Solutions LLC, as borrower, CPS Holdings Inc., as guarantor, the lenders party thereto from time to time, and Ridgeline National Bank, N.A. ("Ridgeline"), as administrative agent and collateral agent. The First Lien Secured Claims include (i) $158,700,000 in aggregate outstanding principal amount under the first lien term loan facility and (ii) $32,600,000 in aggregate drawn and outstanding principal amount under the first lien revolving credit facility, together totaling $191,300,000 in aggregate principal amount of First Lien Secured Claims, plus accrued and unpaid interest, fees, expenses, and other amounts due and owing thereunder.
20.  Under the Plan, holders of Class 2 claims shall receive, in full and final satisfaction, settlement, release, and discharge of their First Lien Secured Claims: (i) their pro rata share of 92% of the newly issued equity interests in reorganized Crestline (the "Reorganized Equity"), subject to dilution by the Management Incentive Plan (as defined in the Plan); and (ii) their pro rata share of $12,500,000 in aggregate principal amount of new first lien take-back term loan debt (the "New First Lien Term Loan"), issued by reorganized Crestline on the terms and conditions set forth in the term sheet attached as Exhibit C to the Plan. Class 2 is impaired under the Plan and is entitled to vote.
Class 3 — Second Lien Secured Claims
21.  Class 3 consists of all allowed claims arising under the 9.75% Senior Secured Second Lien Notes due 2024 (the "Second Lien Notes"), issued on October 13, 2017 pursuant to that certain Indenture dated as of October 13, 2017 (the "Second Lien Indenture"), by and between Crestline Packaging Solutions LLC, as issuer, CPS Holdings Inc., as guarantor, and Continental Fiduciary Trust Company ("Continental Fiduciary"), as indenture trustee and collateral agent. The Second Lien Notes bear interest at a rate of 9.75% per annum and are identified by CUSIP No. 22761TAA3. As of the Petition Date, the outstanding principal amount of the Second Lien Notes was $56,000,000, plus accrued and unpaid interest of approximately $3,900,000 (including default rate interest at an additional 2.00% per annum from April 22, 2022, the date of the first interest payment default), for a total amount of Class 3 claims of approximately $59,900,000.
22.  Under the Plan, holders of Class 3 claims shall receive, in full and final satisfaction, settlement, release, and discharge of their Second Lien Secured Claims: (i) their pro rata share of 8% of the Reorganized Equity, subject to dilution by the Management Incentive Plan; and (ii) warrants entitling the holders thereof to purchase, in the aggregate, up to an additional 5% of the Reorganized Equity (on a fully diluted basis), subject to dilution by the Management Incentive Plan, at a strike price and on the terms and conditions set forth in the Warrant Agreement attached as Exhibit D to the Plan. Class 3 is impaired under the Plan and is entitled to vote.
Class 4 — General Unsecured Claims
23.  Class 4 consists of all allowed general unsecured claims against the Debtors, including but not limited to trade claims, contract rejection damage claims, and other unsecured claims that are not otherwise classified under the Plan. The aggregate amount of Class 4 claims is estimated to be approximately $14,800,000.
24.  Under the Plan, holders of Class 4 claims shall receive, in full and final satisfaction, settlement, release, and discharge of their general unsecured claims, their pro rata share of a $1,500,000 cash distribution pool (the "GUC Distribution Pool"), which shall be funded by reorganized Crestline on the Effective Date. Based on the estimated aggregate amount of Class 4 claims, the estimated recovery for holders of Class 4 claims is approximately 10.1 cents on the dollar, or approximately 10.1%. Class 4 is impaired under the Plan and is entitled to vote.
Class 5 — Intercompany Claims
25.  Class 5 consists of all intercompany claims between and among the Debtors. Under the Plan, Class 5 claims shall be, at the Debtors' election, either reinstated or cancelled on the Effective Date. The treatment of Class 5 claims shall be determined by the Debtors in their sole discretion in consultation with the Requisite Consenting Creditors (as defined in the Restructuring Support Agreement). Class 5 is not entitled to vote on the Plan.
Class 6 — Existing Equity Interests
26.  Class 6 consists of all existing equity interests in CPS Holdings Inc., which are held by Thornfield Capital Partners LP. Under the Plan, all Class 6 equity interests shall be cancelled on the Effective Date, and holders thereof shall receive no distribution under the Plan. Class 6 is deemed to have rejected the Plan pursuant to section 1126(g) of the Bankruptcy Code, and holders of Class 6 interests were not solicited and were not entitled to vote on the Plan.
IV. TABULATION PROCEDURES AND METHODOLOGY
A. Receipt and Processing of Ballots
27.  In accordance with the Solicitation Procedures Order and the instructions set forth in the ballot forms, Pinnacle received ballots from holders of claims in Classes 2, 3, and 4 by the following methods: (i) first-class mail, postage prepaid, addressed to Pinnacle Claims Administration LLC, Ballot Processing Center, P.O. Box 5012, St. Paul, Minnesota 55101; (ii) overnight courier or hand delivery to Pinnacle Claims Administration LLC, Attn: Crestline Packaging Ballot Tabulation, 1010 Dale Street North, Suite 200, St. Paul, Minnesota 55117; and (iii) electronic submission through Pinnacle's secure online balloting portal at https://cases.pinnacleadmin.com/crestline (the "Balloting Portal"). Ballots submitted via facsimile or electronic mail (other than through the Balloting Portal) were not accepted.
28.  All ballots were required to be properly completed, executed, and actually received by Pinnacle on or before the Voting Deadline of August 3, 2022 at 5:00 p.m. (Eastern Time). Ballots received after the Voting Deadline were not counted, regardless of when they were mailed or transmitted.
29.  Upon receipt, each ballot was logged and reviewed by Pinnacle personnel for the following:
(a) Timely receipt. Whether the ballot was received by Pinnacle on or before the Voting Deadline.
(b) Proper completion and execution. Whether the ballot was properly completed, including the identification of the voting party, the claim amount, and a clear indication of whether the holder accepted or rejected the Plan, and whether the ballot was duly executed by the holder or an authorized representative thereof.
(c) Identification of the claimant and claim amount. Whether the ballot identified the holder's name and the amount of the claim with sufficient specificity to enable Pinnacle to verify the holder's entitlement to vote and the claim amount for tabulation purposes.
(d) Clear indication of vote. Whether the ballot contained a clear and unambiguous indication of the holder's vote to accept or reject the Plan. Ballots that indicated both acceptance and rejection, or that failed to indicate either acceptance or rejection, were deemed defective.
(e) Absence of conditions or qualifications. Whether the ballot was free of any conditions, qualifications, or modifications to the holder's vote. Ballots containing any conditions, qualifications, or modifications were not counted, as provided in the Solicitation Procedures Order.
B. Ballot Counting Rules
30.  Votes were tabulated in accordance with section 1126(c) of the Bankruptcy Code, which provides that a class of claims has accepted a plan if such plan has been accepted by creditors, other than any entity designated under section 1126(e), that hold at least two-thirds in amount and more than one-half in number of the allowed claims of such class held by creditors that have accepted or rejected such plan. Only ballots that were properly completed, executed, and timely received were included in the tabulation.
31.  The following additional rules were applied in the tabulation process, consistent with the Solicitation Procedures Order:
(a) Duplicative ballots. In instances where a holder submitted more than one ballot with respect to the same claim, only the latest-dated valid ballot was counted for purposes of the tabulation. If two or more ballots for the same claim bore the same date, Pinnacle attempted to contact the holder to determine the holder's intent. If the holder's intent could not be ascertained, the latest-received ballot was counted.
(b) Defective ballots. Ballots that were unsigned, illegible, received after the Voting Deadline, or that contained conditions, qualifications, or modifications on the vote were deemed defective and were not counted in the tabulation. Pinnacle used reasonable efforts to contact holders who submitted defective ballots to provide them an opportunity to cure any defects prior to the Voting Deadline; however, Pinnacle was under no obligation to seek the cure of any defective ballot.
(c) Ballots subject to pending claim objections. Ballots cast by holders whose claims were the subject of pending objections were provisionally counted for tabulation purposes, subject to further order of the Court. To the extent that the resolution of any such objection would alter the voting results for any class, the Debtors reserve the right to bring such matter to the attention of the Court at or prior to the Confirmation Hearing.
(d) Beneficial holders of Second Lien Notes. With respect to Class 3 (Second Lien Secured Claims), beneficial holders of the Second Lien Notes were required to submit their ballots through the nominee or broker through which they held such notes, or to otherwise provide evidence of their beneficial ownership. Master ballots were submitted by the nominees on behalf of beneficial holders, and the votes reflected on such master ballots were tabulated in accordance with the instructions contained therein.
C. Temporary Allowance of Claims for Voting Purposes
32.  For purposes of voting on the Plan, claims were temporarily allowed at the amounts reflected on the Debtors' schedules of assets and liabilities (the "Schedules"), as may be amended, or as set forth in timely filed proofs of claim, unless (i) the claim was the subject of a pending objection, in which case the claim was temporarily allowed in the amount, if any, set forth in the applicable ballot (subject to Court resolution), or (ii) the Court had entered an order establishing a different allowed amount for voting purposes. To the extent that any claim was scheduled as disputed, contingent, or unliquidated, such claim was temporarily allowed for voting purposes at the lesser of (a) the amount asserted in the proof of claim, if any, and (b) $1.00, unless otherwise ordered by the Court.
V. VOTING RESULTS — CERTIFICATION
A. Statutory Threshold
33.  Under section 1126(c) of the Bankruptcy Code, a class of claims has accepted a plan of reorganization if the plan has been accepted by creditors that hold at least two-thirds in amount (i.e., 66.67% or more) and more than one-half in number (i.e., more than 50.00%) of the allowed claims of such class held by creditors, other than any entity designated under section 1126(e), that have accepted or rejected such plan. The tabulation results set forth below are presented in accordance with these statutory requirements.
B. Class 2 — First Lien Secured Claims
34.  The following table summarizes the voting results for Class 2 (First Lien Secured Claims):
35.  The aggregate principal amount of First Lien Secured Claims is $191,300,000. Of the 24 holders of Class 2 claims that returned valid, timely ballots, 21 holders, holding claims in the aggregate amount of $181,161,100, voted to accept the Plan, and 3 holders, holding claims in the aggregate amount of $10,138,900, voted to reject the Plan.
36.  Accordingly, the Plan was accepted by holders representing 94.7% of the aggregate amount of Class 2 claims that voted, which exceeds the two-thirds (66.67%) threshold required under section 1126(c) of the Bankruptcy Code. The Plan was further accepted by 87.5% of the number of Class 2 claimants that voted, which exceeds the one-half (50.00%) threshold required under section 1126(c) of the Bankruptcy Code.
37.  Conclusion: Class 2 (First Lien Secured Claims) has ACCEPTED the Plan.
C. Class 3 — Second Lien Secured Claims
38.  The following table summarizes the voting results for Class 3 (Second Lien Secured Claims):
39.  The aggregate amount of Second Lien Secured Claims is approximately $59,900,000, consisting of $56,000,000 in outstanding principal amount of the Second Lien Notes (CUSIP No. 22761TAA3) plus approximately $3,900,000 in accrued and unpaid interest (including default rate interest at an additional 2.00% per annum from April 22, 2022). Of the 14 holders (or nominees submitting master ballots on behalf of beneficial holders) of Class 3 claims that returned valid, timely ballots, 11 holders, holding claims in the aggregate amount of $53,430,800, voted to accept the Plan, and 3 holders, holding claims in the aggregate amount of $6,469,200, voted to reject the Plan.
40.  Accordingly, the Plan was accepted by holders representing 89.2% of the aggregate amount of Class 3 claims that voted, which exceeds the two-thirds (66.67%) threshold required under section 1126(c) of the Bankruptcy Code. The Plan was further accepted by 78.6% of the number of Class 3 claimants that voted, which exceeds the one-half (50.00%) threshold required under section 1126(c) of the Bankruptcy Code.
41.  Conclusion: Class 3 (Second Lien Secured Claims) has ACCEPTED the Plan.
D. Class 4 — General Unsecured Claims
42.  The following table summarizes the voting results for Class 4 (General Unsecured Claims):
43.  The aggregate estimated amount of General Unsecured Claims is approximately $14,800,000. Of the 38 holders of Class 4 claims that returned valid, timely ballots, 26 holders, holding claims in the aggregate amount of $11,292,400, voted to accept the Plan, and 12 holders, holding claims in the aggregate amount of $3,507,600, voted to reject the Plan.
44.  Accordingly, the Plan was accepted by holders representing 76.3% of the aggregate amount of Class 4 claims that voted, which exceeds the two-thirds (66.67%) threshold required under section 1126(c) of the Bankruptcy Code. The Plan was further accepted by 68.4% of the number of Class 4 claimants that voted, which exceeds the one-half (50.00%) threshold required under section 1126(c) of the Bankruptcy Code.
45.  Conclusion: Class 4 (General Unsecured Claims) has ACCEPTED the Plan.
VI. CONSOLIDATED SUMMARY OF VOTING RESULTS
46.  The following table presents a consolidated summary of the voting results for all impaired classes entitled to vote on the Plan:
47.  As reflected in the table above, each of the three impaired classes entitled to vote on the Plan — Class 2 (First Lien Secured Claims), Class 3 (Second Lien Secured Claims), and Class 4 (General Unsecured Claims) — has accepted the Plan by the requisite statutory majorities under section 1126(c) of the Bankruptcy Code. Specifically, in each such class, the Plan was accepted by creditors holding at least two-thirds in amount and more than one-half in number of the allowed claims of such class that voted to accept or reject the Plan.
48.  In addition, as set forth in Section III above, Class 1 (Other Priority Claims) is unimpaired and deemed to accept the Plan under section 1126(f) of the Bankruptcy Code. Class 6 (Existing Equity Interests) is deemed to reject the Plan under section 1126(g) of the Bankruptcy Code. Class 5 (Intercompany Claims) was not entitled to vote on the Plan. Accordingly, all classes of claims entitled to vote have accepted the Plan.
VII. IRREGULARITIES AND DEFECTIVE BALLOTS
49.  In the course of the ballot tabulation process, Pinnacle identified the following irregularities with respect to certain ballots received:
(a) Late Ballots. Pinnacle received a total of four (4) ballots after the Voting Deadline of August 3, 2022 at 5:00 p.m. (Eastern Time). These late ballots consisted of one (1) ballot in Class 2, zero (0) ballots in Class 3, and three (3) ballots in Class 4. In accordance with the Solicitation Procedures Order, these late ballots were not counted in the tabulation of votes. The late ballots are identified on Exhibit D hereto.
(b) Defective Ballots. Pinnacle received a total of two (2) ballots that were deemed defective and were not counted. One (1) ballot in Class 3 was unsigned and was not cured despite Pinnacle's reasonable efforts to contact the holder prior to the Voting Deadline. One (1) ballot in Class 4 contained conditional language purporting to condition the holder's vote on the resolution of a pending contract dispute and was therefore excluded as a conditional ballot. These defective ballots are identified on Exhibit D hereto.
(c) Duplicate Ballots. Pinnacle received a total of three (3) duplicate ballots — two (2) in Class 2 and one (1) in Class 4. In each instance, the later-dated ballot was counted and the earlier-dated ballot was excluded, in accordance with the ballot counting rules set forth in the Solicitation Procedures Order and described in Section IV.B above.
(d) Motions to Designate. As of the date of this declaration, no party in interest has filed a motion to designate (i.e., disqualify) any vote under section 1126(e) of the Bankruptcy Code. Accordingly, no votes have been designated or excluded under section 1126(e).
50.  Pinnacle confirms that none of the irregularities described above, individually or in the aggregate, would alter the outcome of the voting in any class. Even if all late and defective ballots were counted (in either direction), the Plan would still satisfy the acceptance thresholds of section 1126(c) in each impaired class.
VIII. EXHIBITS
51.  Attached hereto as exhibits and incorporated herein by reference are the following detailed tabulation reports and schedules:
Exhibit A — Detailed Tabulation Report for Class 2 (First Lien Secured Claims). Exhibit A sets forth an itemized list of each ballot received by Pinnacle from holders of Class 2 claims, identifying (i) the claimant or holder name, (ii) the claim amount, (iii) the vote cast (accept or reject), and (iv) whether the ballot was counted or excluded (and if excluded, the reason for exclusion). Exhibit A contains 24 counted ballots and 3 excluded ballots (consisting of 1 late ballot and 2 duplicate ballots).
Exhibit B — Detailed Tabulation Report for Class 3 (Second Lien Secured Claims). Exhibit B sets forth an itemized list of each ballot (including master ballots submitted by nominees on behalf of beneficial holders) received by Pinnacle from holders of Class 3 claims, in the same format as Exhibit A. Exhibit B contains 14 counted ballots and 1 excluded ballot (consisting of 1 defective/unsigned ballot).
Exhibit C — Detailed Tabulation Report for Class 4 (General Unsecured Claims). Exhibit C sets forth an itemized list of each ballot received by Pinnacle from holders of Class 4 claims, in the same format as Exhibit A. Exhibit C contains 38 counted ballots and 5 excluded ballots (consisting of 3 late ballots, 1 conditional ballot, and 1 duplicate ballot).
Exhibit D — Schedule of Defective or Late Ballots. Exhibit D sets forth a consolidated listing of all ballots that were not counted in the tabulation, including (i) the name of the submitting party, (ii) the class of the claim, (iii) the claim amount, (iv) the date and time of receipt (if applicable), and (v) the reason for exclusion.
52.  The information contained in Exhibits A through D was compiled from Pinnacle's records and represents a complete and accurate accounting of all ballots received by Pinnacle in connection with the solicitation of votes on the Plan.
IX. CONCLUSION AND CERTIFICATION
53.  Based on the foregoing, Pinnacle Claims Administration LLC hereby certifies, under penalty of perjury pursuant to 28 U.S.C. § 1746, as follows:
(a) The tabulation of votes described in this declaration was conducted in accordance with the Solicitation Procedures approved by the Court pursuant to the Solicitation Procedures Order [Dkt. 22] and the applicable provisions of the Bankruptcy Code, including sections 1125, 1126(b), and 1126(c) thereof.
(b) All ballots received by Pinnacle on or before the Voting Deadline of August 3, 2022 at 5:00 p.m. (Eastern Time) were properly processed and tabulated in accordance with the procedures and rules described herein and in the Solicitation Procedures Order.
(c) Each of the three impaired classes of claims entitled to vote on the Plan has accepted the Prepackaged Plan of Reorganization by the requisite statutory majorities under section 1126(c) of the Bankruptcy Code, specifically:
(i) Class 2 (First Lien Secured Claims) accepted the Plan by 94.7% in amount and 87.5% in number of voting claimants;
(ii) Class 3 (Second Lien Secured Claims) accepted the Plan by 89.2% in amount and 78.6% in number of voting claimants; and
(iii) Class 4 (General Unsecured Claims) accepted the Plan by 76.3% in amount and 68.4% in number of voting claimants.
In each case, the acceptance exceeds the statutory thresholds of at least two-thirds in amount and more than one-half in number of claims voting as required by section 1126(c) of the Bankruptcy Code.
(d) This declaration and the certifications contained herein are true and correct to the best of the declarant's knowledge, information, and belief, formed after reasonable inquiry.
54.  Pinnacle respectfully submits this declaration in support of the Debtors' request for confirmation of the Plan and stands ready to provide any additional information or testimony that the Court may require in connection with the Confirmation Hearing.
X. SIGNATURE BLOCK AND ATTESTATION
I declare under penalty of perjury under the laws of the United States of America that the foregoing is true and correct.
Executed on August 5, 2022, at St. Paul, Minnesota.
PINNACLE CLAIMS ADMINISTRATION LLC
By: ________
Name: Jennifer R. Lindquist
Title: Senior Vice President and Director of Tabulation Services
Address: 1010 Dale Street North
St. Paul, Minnesota 55117
Date: August 5, 2022
CERTIFICATE OF SERVICE: I hereby certify that on August 5, 2022, a true and correct copy of the foregoing Declaration of Pinnacle Claims Administration LLC Certifying the Tabulation of Votes on the Prepackaged Plan of Reorganization of Crestline Packaging Solutions LLC and CPS Holdings Inc., together with Exhibits A through D attached thereto, was served upon all parties entitled to notice by filing with the Court's electronic case filing system (CM/ECF), which will send notification of electronic filing to all registered participants, and by first-class mail, postage prepaid, upon those parties not registered for electronic notice, in accordance with Bankruptcy Rules 2002 and 9036 and the applicable local rules of this Court.
________________________________________
Jennifer R. Lindquist Senior Vice President and Director of Tabulation Services Pinnacle Claims Administration LLC
In re: | Chapter 11
CRESTLINE PACKAGING SOLUTIONS LLC and CPS HOLDINGS INC., | Case No. 22-51247
Debtors. | (Jointly Administered)
Metric | Accepting | Rejecting | Total Voting | Percentage Accepting
Amount ($) | $181,161,100 | $10,138,900 | $191,300,000 | 94.7%
Number of Claims | 21 | 3 | 24 | 87.5%
Metric | Accepting | Rejecting | Total Voting | Percentage Accepting
Amount ($) | $53,430,800 | $6,469,200 | $59,900,000 | 89.2%
Number of Claims | 11 | 3 | 14 | 78.6%
Metric | Accepting | Rejecting | Total Voting | Percentage Accepting
Amount ($) | $11,292,400 | $3,507,600 | $14,800,000 | 76.3%
Number of Claims | 26 | 12 | 38 | 68.4%
Class | Description | Accepting (Amount) | Threshold (Amount) | Accepting (Number) | Threshold (Number) | Plan Accepted?
2 | First Lien Secured Claims | 94.7% | ≥ 66.67% | 87.5% | > 50.00% | Yes
3 | Second Lien Secured Claims | 89.2% | ≥ 66.67% | 78.6% | > 50.00% | Yes
4 | General Unsecured Claims | 76.3% | ≥ 66.67% | 68.4% | > 50.00% | Yes